SEC ends investigation into Stacks developer Hiro Systems

The SEC has finally ended its three years long investigation into the blockchain developer Hiro Systems. Hiro was previously known as Blockstack and it raised $70 million from token sales between 2017 and 2019. That got the SEC’s attention.

Hiro Systems developed the Stacks chain with its token STX, in 2018. The Stacks project started in 2017, intending to bring programmability and dApps to Bitcoin.

Back then, the founder Muneeb Ali said he wanted to use Bitcoin’s security and network to support smart contracts and decentralized applications (dApps).

In 2019, Stacks had the first-ever SEC-qualified initial coin offering. But then in 2021, Gary Gensler came knocking because he believed the token sales should have been registered as securities offerings under securities laws. In a post on Twitter, Muneeb said: 

“For three-plus years, we have provided all requested information and explained how the Stacks network works and Hiro’s role as a developer tooling company. We’re pleased that the SEC dropped the investigation after this time and effort.”

Muneeb added that this is the best outcome a company in the crypto industry could ask for, but still. America can do better. The industry needs a regulatory system that meets builders of innovative open protocols where they are, says Muneeb.